522-4

Table 2

Aggregate Loan Portfolio of the
College Housing Program

1984 1983 1982

Selected Assets

Outstanding Loan Volume $2,675,520,000 $3,025,464,000 $3,045,113,000

6NMA Fund 337,357,000 89,207,000 41,716,000

Selected Liabilities

Outstanding Treasury Borrowing $2,687,325,000 $2,687,325,000 $2,687,325,000

Outstanding GNMA Liability 451,504,000 451,504,000 451,504,000

Defaulted Loan Volume* 105,561,000 114,700,000 116,000,000

a This is an expected offset on the outstanding loan volume.
Source: E.I.

In FY 1984, the major portion of loan repayments and other income was used to
pay program operating costs. These costs include the following.

o An estimated $70,212,000 for interest expenses on borrowed Treasury
funds used to make loans in prior years. This expense was $67,613,000
in 1983.

o Interest expenses of $28,138,000 on GNMA participation certificates
(the same expense level as 1983).

o Principal payments of $248,151,000 to the GNMA participation sales
fund. These funds have been used to amortize the outstanding principal
debt on participation certificates which will be redeemed in by FY 1988.
This transfer payment was $47,491,000 in FY 1983. The Department was
able to make this high payment because in FY 1984, 22.8 percent of the
outstanding principal balance was retired through prepayments which
took advantage of the discount.

o A total of $485,000 for loan servicing and management expenses of the
Federal Reserve Bank and maintenance of repossessed properties. This
cost was $807,000 in 1983.

D. Plans for Program Improvement and Recommendations for Legislation

Because enrollments are no longer rapidly expanding, there is no need for
a Federal program.

No authority for new loan commitments in FY 1985 was requested. This re-
flected the Administration's overall effort to reduce Federal discretion-
ary expenditures for non-essential purposes and to reduce Federal borrowing,
thereby controlling Inflation and relieving pressure on financial markets.
In 1984, credit management improvement efforts were continued. Due to the
new loan discounting authority about $485.5 million was collected in FY 1984,
a $306.3 million increase over FY 1983 collections. FY 1985 collections
are expected to be about $151.3 million.,100 272,000